Ruling party senator Ly Yong Phat has defied an order endorsed by the Prime Minster to halt his controversial sand dredging activities on the Tatai river in Koh Kong, prompting authorities to request intervention, documents obtained by The Post reveal.

The dredging operation on the Tatai river has stirred up serious concern from tourism operators and villagers in the area, who have said it is destroying the local environment and driving customers away.

Government officials appear at loggerheads over the tycoon’s operations.

The Water Resources Minister has insisted in a letter that the so-called “King of Koh Kong” cease violating the ban, but provincial authorities have denied that dredging was even taking place. The Ministry of Industry, Mining and Energy, meanwhile, has extended the LYP Group’s dredging licence by a year.

A blunt letter written by Minister for Water Resources Lim Kean Hor, dated August 4, called for the intervention of provincial governor Bun Leut to enforce a July 15 temporary ban on LYP Group dredging.

“The Sand Resource Management Committee already informed the company on July 15, 2011, to postpone the business activity so a study could be re-conducted. But up until now, the company has not yet postponed its business activities,” the letter reads.

The tycoon's company had been found to be dredging beyond authorised boundaries and using too much equipment, it added.

Just days before the letter was sent, however, the Ministry of Industry, Mining and Energy issued LYP Group with a 12-month permit extension on July 28. The renewed license, also obtained by The Post, shows that Ly Yong Phat will now be allowed to continue dredging at seven locations until September 2012, though the total area of the permit will be reduced from 3,229 hectares to 1,241 hectares.

At that point LYP Group will have been dredging in the area for five years, the licence signed by industry minister Suy Sem stated.

Ly Yong Phat, Suy Sem, Lim Kean Hor and Bun Leut could not be reached for comment yesterday. But Phay Siphan, spokesman for the Council of Ministers, said yesterday he had visited the upper Tatai river last week and observed dredging near eco-resorts in the area, which he believes should be stopped immediately.

“All the companies shall listen to critical agencies that are involved there like the [Ministry of] Environment. All the businessmen that are involved in dredging in that area shall be stopped immediately,” he said.

He emphasised any halt would be temporary to allow further inspection of impacts from the dredging. Pech Siyon, Koh Kong provincial director department of Industry, Mines and Energy, denied yesterday dredging was taking place in the banned area and said he was not aware of any new licence granted to LYP Group either.

“LYP is still sand dredging in the lower Tatai, but operations at the upper Tatai have remained postponed as normal since the ban by Prime Minister Hun Sen,” he said, adding the sand was destined for export to Singapore.

Political wrangling has done nothing to ease the minds of affected residents.

Dredging operations are now taking place about 30 metres off the shore of the river’s Andaet island, resident Vora Huy Kanthoul said on Monday, raising his concern the entire land mass would collapse into the river.

“We have a problem, nobody can sleep at night, they do it at night and they’ve been doing that for about 10 days,” he said. Villagers who had agreed to embrace ecotourism instead of traditional forms of income had been sold short by dredging, while crab yields had reportedly dropped by 90 percent.  

“They used to hunt illegal game and the local NGOs and the environmental NGOs have been very successful in changing their way of living from poaching to ecotourism, but now they say [dredging is] going to affect them so in the long run and that will really affect the economy,” he said.

Pech Siyon said his department wasn’t worried about public concern surrounding the impact of LYP Group’s operations on tourism investment and local livelihoods, but was focused on closely monitoring the company to ensure they respected regulations.

The Singapore Ministry of National Development has repeatedly failed to reply to inquiries.